In general, the futures price is usually higher than the spot price (positive market), because the futures price represents the future market price, including the position fee. Position fee refers to the sum of storage fee, insurance premium, interest and other expenses paid for owning a certain commodity or securities.

The market where the spot price is higher than the futures price is the reverse market. There are two main reasons for this market state.

First, the demand for a commodity in the near future is very urgent, which is greater than the recent output and inventory, which makes the spot price rise sharply, higher than the futures price; For example, the spot price of sugar is much higher than the futures price.

Second, it is expected that the supply of this commodity will increase substantially in the future, resulting in a sharp drop in futures prices, which is lower than the spot price. You can contact me if you don't understand.